On the backdrop of Cop27, Africa is on the path to using data to fight food insecurity, adapt to climate change, and influence commodity prices for future crop seasons
By Kamaldeen Raji, Managing Director of AFEX Fair Trade Limited
In 2020, the African Development Bank in partnership with the Food and Agriculture Organization’s Investment Centre identified the lack of data-driven solutions as a key inhibitor of agricultural development in Africa particularly for smallholder farmers. They recommended that data-driven technologies can transform the agricultural ecosystem and contribute to policy-making and investment. They added that, in order to achieve true game-changing effects for the agricultural sector on the continent, the scalability and sustainability of present and future agritech solutions in Africa may depend on the fusion of infrastructural solutions. Since the call, reports like the Wet Season Crop Report published by AFEX became imperative. AFEX is Nigeria’s first private exchange for agricultural commodities that provides access to markets and finance for over 200,000 smallholder farmers and connects them with processors and investors via their technology platform and 120 warehouses. The report surveyed 20,677 farmers in key producing regions to analyse the food security status in Nigeria. A major finding indicated that out of 5.7 million registered farmers in Nigeria, only 15% are food secure.
The Impact of the Climate Crisis on Agriculture
The just-ended United Nations Climate Change Conference COP27 closed in November with a breakthrough agreement to provide “loss and damage” funding for vulnerable countries hit hard by climate disasters. According to Simon Stiell, UN Climate Change Executive Secretary, ‘this outcome moves us forward. Creating a specific fund for loss and damage marked an important point of progress, with the issue added to the official agenda and adopted for the first time at COP27. This ground-breaking decision for many governments in developing countries will enable them to establish new funding arrangements to respond to post-harvest losses, flooding, and other climate-related disasters in the agriculture sector.
The Report revealed that the present flood in Nigeria has been described as the worst in a decade. The flood affected 29 of 36 states with key agricultural states such as Benue, Niger, Jigawa, Adamawa, Kebbi, Kano, Kaduna, and Taraba all affected and over 108,000 hectares of farmland were destroyed in the country. It is estimated that the disaster’s damage now exceeds N40 billion with rice, maize, sorghum, millet, and other crops and livestock being destroyed. Immediate efforts are needed to alleviate the disaster’s consequences to reduce hunger and improve food security. With the agreement on loss and damage funding confirmed, we will wait to see what the modalities of the rollout will entail for African countries. As a result of the flood and a fungal infestation that wreaked havoc on rice plantations, the forecast for rice output in the wet season of 2022 is a 21% decline, 9% of which is linked directly to flood impact. A key recommendation to increase production in spite of the loss is the injection of input subsidy by the state to ensure that planting and harvesting progress in the dry season to increase yield.
A call for access to finance for agricultural input solutions
Due to the Ukraine-Russia conflict the prices of fertilizer have continued to rise, and many farmers in Africa resorted to the use of alternative and indigenous farming input methods. This is evident in the Wet Season Crop production report which identified a reduction in the use of inorganic fertilizers and the application of alternatives. In the latest AFEX report analyzing the planting behaviour of farmers in the 2022 wet season, it was reported that most farmers were unable to increase the number of hectares compared to the previous year. However, farmers resorted to using more herbicides and more local seed varieties to compensate for low fertilizer usage to protect their yields.
The current fertilizer shortage is a ripe opportunity to begin the pivot to regenerative agriculture and nature-based solutions under a whole food systems approach, which can bring multiple benefits for climate, health, resilience, biodiversity, and social justice. With innovative climate finance, Africa can transform agriculture and food systems for food and economic security to meet its SDG goals. Commensurate climate finance and innovation are key for the sector to close the triple gap of producing more food while releasing fewer emissions, on the same amount of land.
The role of data and Infrastructure
Data and infrastructure are critical to the growth of any industry. It is necessary to strengthen the data system by modernizing the production and use of agricultural statistics in order to measure direct effects on farmers and the economy and inform policies to improve resilience in agriculture, nutrition, and food security on the continent.
Industry players are also better positioned to provide the appropriate infrastructure to meet the demand.
COP27 may have ended but companies like AFEX, one of the most successful exchanges in Africa are leading Africa’s commodity data collection and analytics to build capacity and awareness within the industry and deliver unique research for investors, producers, and processors. With the company’s broader pan-African growth targets, an expansion will allow AFEX to replicate its success in Nigeria in securing better livelihoods for smallholder farmers and enabling seamless access to pan-African commodities trading across the continent while bolstering the continent’s food security.
